BT's rivals are being given the right to install their own high speed internet access machinery in the exchanges as part of the UK government's plans to shake up BT's grip on internet access.

The long delayed goal is to provide a widespread, high speed, clock-free and affordable internet.

Thus had earlier applied for space for its broadband equipment in 300 BT exchanges, and was setting aside £40m for the development.

But now the company says it cannot "justify the economics" of installing broadband DSL (digital subscriber line) equipment in these phone exchanges, and has decided to call it off.

Regulator under fire

This makes Thus the latest in a stream of companies that have ditched their plans to take part in the shake up of internet access in the UK, which should lead to the provision of flat-rate, unmetered high-speed internet.

WorldCom, RSL Communications and Dutch firm Versatel have already pulled out of the race.

Internet users are eagerly waiting for broadband to arrive

Earlier this month, UK telecoms regulator Oftel called an industry summit asking why companies were cancelling their original ambitions.

The UK telecoms regulator Oftel and BT have been accused of dragging their feet on the issue by rivals to the former state monopoly.

Companies complain that business plans can not justify the investment costs needed to roll out the project.

This has a lot to do with the fact that many exchanges tend to be rural, meaning that the companies have fewer customers to sell their service to, making it more difficult to make money.

But at the summit the regulator and the firms came to an agreement to push forward the opening of the urban loops.

Cutting losses

The news comes at the same time as Thus announced much improved company results.

Losses in the third quarter stood at just £4.7m, compared with £8.6m in the previous three months.

And sales rose by 20% in the same period, rising to £55.9m.

The purchase of internet provider Demon is still serving the Scottish company well, with internet sales growing over 13% during the three month period.

Thus share prices rose 16.7% during the day, to close 12.5p higher at 74.5p.